Wall Street closed higher and the NASDAQ reached an all-time closing high on Thursday as investors headed into a long holiday weekend buoyed by a record surge in payrolls, which provided assurance that the US economic recovery was well under way.
All three major US stock averages advanced, with the benchmark S&P 500 posting its fourth straight daily gain.
Massive stimulus and hopes for a speedy economic rebound have returned the S&P 500 and the NASDAQ to 7.6 percent and 12.6 percent below their record highs reached in February.
According to the US Department of Labor, the US economy last month added 4.8 million jobs — 1.8 million more than analysts expected and setting a second consecutive record.
Massive rehiring sent the unemployment rate down to 11.1 percent.
“There was a lot to like in economic data for the week, and there’s still talk that there will be more stimulus from Washington after they get back from the fourth of July break,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
However, even with May and last month’s consecutive record payroll gains, the labor market has still recovered only a fraction of the 22 million jobs lost in the March-to-April plunge.
The recovery of the US economy, now in its sixth month of recession, could stall as new cases of COVID-19 hit record levels and several states hit hardest by the resurgence halted or reversed plans to reopen their economies.
Florida on Thursday reported a record-shattering 10,000 new cases, worse than any European country at the peak of their outbreaks.
“With the spikes [in new COVID-19 cases] we’ve seen the larger states — Texas, California and Florida — those states have taken steps to turn back their re-opening plans, and that will slow the overall growth and consumer spending in those regions,” Nolte added.
In the coming weeks, market participants are predicted to train their focus on second-quarter reporting season.
In aggregate, analysts now expect S&P earnings to have dropped by 43.1 percent as companies grapple with plunging demand and disrupted supply chains.
The Dow Jones Industrial Average rose 92.39 points, or 0.36 percent, to 25,827.36, the S&P 500 gained 14.15 points, or 0.45 percent, to 3,130.01 and the NASDAQ Composite added 53 points, or 0.52 percent, to 10,207.63.
Compared with Friday last week, the Dow ended up 0.87 percent, the S&P 500 gained 2.92 percent and the NASDAQ 6.45 increased percent.
Of the 11 major sectors in the S&P 500, all but real estate and communications services closed higher, with materials enjoying the largest percentage gain.
Microsoft Corp provided the biggest boost to the S&P 500, and last month retained its top spot as the most globally invested stock, data from trading platform eToro showed.
Tesla Inc jumped 8 percent after the electric automaker’s second-quarter vehicle deliveries beat Wall Street estimates.
Advancing issues outnumbered declining ones on the NYSE by a 1.90-to-1 ratio; on the NASDAQ, a 1.28-to-1 ratio favored advancers.
The S&P 500 posted 36 new 52-week highs and no new lows; the NASDAQ Composite recorded 123 new highs and 10 new lows.
Volume on US exchanges was 10.03 billion shares, compared with the 13.24 billion average over the past 20 trading days.
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